Tuesday, November 5, 2024

Hermetica Launches Bitcoin-backed Artificial Greenback

USDh leverages the Runes protocol and at present affords a 12% staking yield.

Hermetica, a Bitcoin-based DeFi protocol, has launched USDh, a dollar-pegged asset native to the world’s most precious blockchain.

The mission touts USDh because the “first Bitcoin-backed, yield-bearing artificial greenback outdoors the fiat system.”

USDh’s stability mechanism is just like that of Ethereum-based Ethena. Hermetica hedges its spot BTC holdings with brief futures positions to make sure that USDh can at all times be redeemed for $1 price of BTC. The funding charges accrued from these brief positions are the supply of yield for USDh stakers.

USDh Design
USDh Design

Whereas the mission claims a staking yield of “as much as 25%,” the app exhibits that sUSDh – the staked model of the token – is at present yielding 11.7%.

Hermetica is leveraging the Runes protocol, launched in April as a extra environment friendly option to inscribe knowledge on Bitcoin. The protocol goals to scale back the footprint of BRC-20s, the earlier iteration of fungible tokens chargeable for clogging up the community and driving up charges.

USDh could be bought with Bitcoin on NFT market Magic Eden, which showcases a 24-hour buying and selling quantity of simply $10,000 for the reason that token launched on July 16 – a far cry from the hype that accompanied the launch of Ethena’s USDe, which now boasts a $3.4 billion market capitalization.

USDh Chart
USDh Chart

Customers can stake their USDh on the Hermetica app and still have the choice to borrow BTC in opposition to their holdings utilizing Liquidium, a Bitcoin-based lending platform for Ordinals and Runes.

The tepid response to the launch might be attributable to a lack of know-how, as Bitcoin’s DeFi ecosystem continues to be in its infancy. Nonetheless, the emergence of a Bitcoin-native secure asset could be seen as a optimistic growth if it will probably scale, because it affords Bitcoiners – who’ve lengthy been cautious of bridging property to different blockchains – a substitute for the centralized stablecoins that dominate the market.

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest Articles